The State of Physical Gold and Silver in 2020
The State of Physical Gold and Silver in 2020 by Rory for The Daily Coin
Support The Daily Coin
The video below, for the first time in a number of years, has really made me think about the state of the physical gold and physical silver markets. For the past three plus years the focus has really been on the charts and movement up and down in allocation cost while adding to the stack has been more of an afterthought.
In 2020 it seems we really need to make some moves very early in the year, otherwise, we will find ourselves, as I did in 2019, leaving a bunch of fiat currency on the table. It’s best to avoid that situation, however, it seemed prudent at the time to wait as I was watching the sales of quarter ounce AGE’s (American Gold Eagles) and wanted to be assured this played out the way I had anticipated. In 2020 let’s reverse that thought and see how it works. Betting on low mintage of AGE coins is one my favorite bets.
We are anticipating another year of very significant chart moves in both gold and silver. We believe that as the year progresses both metals will reach for much higher chart levels. This means gathering in any physical metal now, in January and February, may be the way to go. Watching for pullbacks is going to be a key element during 2020 to keep as much powder dry as possible. It seems almost impossible, not saying that is impossible, to see either of the metals price retreat much lower from where we find them today. Let’s not forget there is that massive bet that was placed for $4,000 gold by June 2021. That would require an upside move of $1,000+ during 2020. Even if this bet is removed from the table, the fact that someone placed it and is looking to make a profit off the bet says a lot about the state of the gold market. It says people understand gold is not just moving higher, it is going to move far higher than most thought possible. Will that happen in 2020? I doubt all of it will, however, there will be enough of a move that I feel confident people that know what I do for a living, people that I have never, ever discussed gold, the economy or anything of the sort will be approaching me throughout the year. Gold and silver, in physical form, is going to make itself known to a segment of the masses – not all but some of the fringe.
Back to the physical. This is one of the main reasons for stacking now, early in the year. If your research, understanding or charts are pointing to much higher gold and silver in 2020 why wait to add to your stack? Quarter ounce AGE’s are looking good right about now, silver Kooks, Koalas and silver Lunar coins are all on the radar. Unfortunately, the America the Beautiful (ATB) series is released throughout the year and if you have already been stacking these coins for the past several years that means we are all going to have to suck it up to continue participating. Will this make the ATB even more prized as people reallocate funds to other coins or situations and leave this program behind? ATB’s might make a good bet for that reason. It’s possible we will see low mintages of each release this year. It’s also possible that we could see each release sell out as people will no longer be able to afford to stack gold. This could be an interesting situation as the year unfold to see what people are doing in the metals markets.
It will be interesting to see how this year plays out in the physical market. I fear a great many people will simply reallocate funds to something else and leave the physical market as gold, in particular, climbs higher and higher. This should bode well for the silver market, but once again we have to take the wait and see approach. My guess is by June / July, mid year, we should have some sense of what is happening and how the markets are going to play out in the second half. Who knows, the metals may have moved to the point of the masses jumping in and pushing the markets to the upside, while the long term stackers pull profits and pay off the mortgage or take the vacation they have been planning or whatever one has been stacking to accomplish. Then again, the cartel could jump in and do their thing and crush the party like a June bug on a windshield. When dealing with criminals anything is possible. Keep eye out over the next few weeks, consider stacking during this time as COMEX gold and COMEX silver could move much higher as the year progresses and if your research shows similar results as mine, then picking up as many quarter ounce AGE’s as possible may treat your portfolio to higher premiums in the long run. Got physical?